19.05.17
HS2 likely to create polarisation of high-skill jobs in London, LSE finds
Better high-speed rail (HSR) links could lead to highly skilled managerial jobs being “geographically polarised” in London, research conducted by the London School of Economics (LSE) has found.
The university looked at the effect that the implementation of high-speed routes had had in France and used the findings to outline what lessons could be taken in the UK as high-speed rail routes are expanded.
LSE researchers found that the easier and faster distribution of managers across different sites of a business allowed by HSR had increased profit margins by 0.6 to 0.8 percentage points for many businesses.
However, they also discovered that HSR led to increases in production jobs being “almost compensated” by the transfer of managerial jobs from affiliates to headquarters.
“This contributes to geographical job polarisation and the clustering of high-skill (managerial) jobs in the largest cities, in particular in the capital city (Paris) where a large fraction (35%) of headquarters are located,” the report said. “The same phenomenon would most likely occur if London, in the UK, became connected via high-speed rail to the northern part of the country.”
The LSE also estimated the overall cost of geographical dispersion for multi-site businesses. It was found that when distances between the sites of businesses were cut down by HSR, production capacity went up by 4% in service and transport, and around 2% in manufacturing, retail and trade.
Today’s report trails yesterday’s commitments from Theresa May to drive forward with plans for HS2 during the unveiling of her party’s manifesto.
HS2 is expected to transform the infrastructure and economies of many regions in the UK. Last week, RTM reported that its technical director Andrew McNaughton had refuted reports that the project was lagging behind schedule and over budget as he told an audience at Railtex that the project had not gone off the rails.
This was despite claims from some, including Lord Berkeley, that HS2 was sure to run out of money before it was finished.
And ongoing issues with procurement for the project, including CH2M withdrawing from the phase 2b civils contract, led many to believe that the planned project would struggle to be finished by its original deadline of 2033.
Nevertheless, in April high-speed rail leaders stated that HS2 should be viewed as not only a national asset, but something that could be a global export for the UK.
Top Image: Ewan Munro
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